Dell Supply Chain and Operation Management - Case Study Example

 Dell Supply Chain Dell Supply Chain Question One: Dell’s direct sales model as an exceptional supply chain Dell has developed an exceptional supply chain using direct sales as the main platform. The direct sales platform at Dell has been made possible by taking into consideration the needs of the customers and the response to the products they manufacture to ensure the customers are satisfied. The responses from the consumers are used in the improvement of the supply chain of the population. Dell has been in a position to ensure the success of direct sales through having great affiliations with the suppliers and the consumers. Access to a huge amount of customer information is the main way in which Dell is in a position to make direct sales through using the information to relate the product specification to meet client needs fully. The market information available to Dell is also used for the understanding of the amount of products required in the market and the realization of the time required to deliver the product in the market direct sales a possibility for Dell. Customer information allows Dell to have an understanding of the market satisfaction and maintain low levels of inventory. Dell maintains and generates a large amount of customer information that allows for the understanding of the needs of the market and satisfying the needs of the clients. The understanding and respect for the suppliers is the other benefit that has allowed Dell to have a better ability to meet market needs. Supply is made at the required time and to meet the requirements specified by Dell generated from the customer information. 2. Operations management development from Dell’s direct sales The direct sales have allowed Dell to improve operations management by ensuring the products can be assembled within hours (Leeman, 2010). Consumers have access to the Dell websites and order the products at their own time regardless of the time of day in different locations globally. Purchases can be tracked by the customers from the ordering stage to when the order is delivered to the consumer providing the consumers’ confidence in their purchases. The good relation with the supplier has allowed Dell to have the assurance of parts delivered at the required time, date, and meeting the specifications. The operations at Dell have also been improved to meet the direct sales requirement by building an innovative and collaborative supply chain. The innovative ordering and production system has also been the other manner in which the direct sales have enabled the operations management at Dell. Direct sales allow Dell to offer clients a platform to provide specifications allowing for products to be manufactured to meet them and augment client satisfactions with the products. Direct sales offer Dell a platform for offering customers new products as soon as they are produced over the internet allowing for feedback for product customization. The internet also allows for early-to-market advantage allowing for high access to a large clientele providing the other manner in which the operations management at Dell has been boosted by direct sales. 3. Disadvantages of Dell’s direct sales model The main disadvantages of Dell’s direct sales model include the increased cost of shipping the products directly to the consumers compared to the normal model of distributors and retailers. The lack of distributors and retailers increase the costs of shipping for Dell. The use of distributors and retailers allow other sellers and Dell’s competitors to ship in bulk reducing the transportation costs offering them a competitive advantage compared to the direct sales in Dell. The other costs to Dell that arise from Dell are tracking costs for the shipments to the consumers and maintenance of shipping information to the consumers globally. The other disadvantage to Dell is the high handling costs of the products for sending to the consumers. The direct sales model at Dell also has the other advantage of augmenting the bargaining power of the suppliers. 4. Dell’s competition with a retailer having stock Competition between Dell and retailers who have stock relates to the stocking costs and shipping. Dell takes into consideration the costs of paying for brick and mortar stores allowing Dell to offer the products at a lower cost compared to the brick and mortar store retailers. The other manner in which Dell competes with the retailers who have stock is the pre-developed products available for review by the customers to allow them to make choices and order for delivery within a matter of hours and meet the specifications perfectly. The ability to meet the client specifications well provides Dell with a competitive advantage allowing customers to have more confidence in Dell and provide for return customers and word of mouth advertising. The store's ability to offer clients a large variety is limited by space giving Dell a competitive advantage and another platform of competition with the retailers who have stock. Dell has a position of meeting the needs of the consumers through the virtual development of the of the product they want, and they are assembled within hours and sent to the client. The client has a higher chance of achieving a product that is customized to their needs and are more satisfied allowing for better client satisfaction. From the analysis, Dell competes with retail stores that have stocks in terms of allowing clients to have customizing options and low prices. Customized Dell products at lower prices for the consumers allow Dell to have a higher competitive advantage over the retail sales for 5. Dell’s supply chain dealing with bullwhip effect The development of merchant websites is the main way in which Dell deals with the bullwhip effect in the supply chain. The merchants have access to the websites allowing them to view the parts required depending on the demand for the consumers as well as understanding the amount of stock at Dell. The realization of the available stock and required the stock to the merchants enables Dell to ensure the required parts are supplied in time and meet the assembling needs at Dell and overcome the bullwhip effect. The supplies understand their needs considering the production required and meet demand in time. Ensuring the supply meets the demand and avoiding inventory build-up is the main way in which Dell deals with bullwhip effect. References Leeman, J. J. (2010). End-to-end Supply Chain Management: Fast, Flexible Supply Chains in Manufacturing and Retailing. Books on Demand. Read More